Brexit set for delay after May wounded by rejection of ‘no-deal’

LONDON (Reuters) – MPs on Wednesday rejected leaving the European Union without a deal in any scenario, paving the way for a vote to seek to delay Brexit until at least the end of June.

Britain’s Prime Minister Theresa May speaks in Parliament, following the vote on Brexit in London, Britain, March 13, 2019, in this screen grab taken from video. Reuters TV via REUTERS

After a day of high drama, MPs voted by 321 to 278 in favour of a motion that ruled out a potentially disorderly ‘no-deal’ Brexit under any circumstances.

It went further than the government’s own planned motion, which noted that parliament did not want to leave without a deal on March 29, the leaving date set down in law, but stressed that the default legal position was to leave without a deal unless one was ratified by parliament.

While the approved motion has no legal force and ultimately may not prevent a no-deal exit, it carries considerable political force, especially as it passed thanks to a substantial rebellion by members of May’s own Conservative Party and her cabinet.

May, who had insisted that it was not possible to completely rule out a no-deal Brexit, said MPs would need to agree a way forward before an extension could be obtained.

The government said it would on Thursday propose seeking to delay Brexit until June 30 if parliament can – by March 20, the day before an EU summit – approve a deal to leave the European Union. The government did not say which day it planned to hold another vote.

Commentators believe that with a no-deal Brexit voted down, May will now hope to persuade hardline pro-Brexit MPs to vote for her deal on the grounds that the alternatives offer a less clean break with the EU.

If no deal is agreed by March 20, “then it is highly likely the European Council at its meeting the following day would require a clear purpose for any extension, not least to determine its length, and any extension beyond 30 June 2019 would require the United Kingdom to hold European Parliament elections in May 2019”, Thursday’s motion says.

“DEAL STILL NEEDED”

After Wednesday’s vote, the European Commission promptly restated its position that it was not enough for parliament to vote against leaving the European Union without a deal — it also needed to find a deal that MPs could accept.

The outcome of the vote angered many pro-Brexit members of the Conservative Party, who had wanted to retain the option of a “no-deal” exit as a bargaining chip, knowing that it would cause disruption in the EU as well as Britain.

After two-and-a-half years of negotiations and two failed attempts to pass a Brexit deal proposed by May, the vote against a no-deal exit still leaves undecided how, when and on what terms Britain will leave the club it joined in 1973.

After MPs crushed her deal for a second time on Tuesday, May said it was still the best option for leaving in an orderly fashion.

The pound rose more than 2 percent on the rejection of ‘no-deal’ and was headed for its biggest daily gain this year. [GBP/]

As the United Kingdom’s three-year Brexit crisis spins towards its finale, diplomats and investors see four main options: a delay, May’s deal passing at the last minute, an accidental no-deal exit or another referendum.

DELAY UNTIL WHEN?

If Britain does seek a delay, it will require the agreement of all the bloc’s other 27 members.

The EU would prefer only a short extension, ending before EU-wide parliamentary elections due May 24-26, although it is not clear that this would be long enough to solve the impasse in London. The new European Parliament convenes on July 2.

EU Brexit negotiator Michel Barnier said the bloc would need to know why Britain wanted to extend talks and that it was up to London to find a way out of the deadlock. The EU said there could be no more negotiations on the divorce terms.

Britons voted by 52-48 percent in 2016 to leave the bloc, a decision that has split the main political parties and exposed deep rifts in British society.

Slideshow (19 Images)

May’s deal covers such things as citizens’ rights, the status of the Irish border and Britain’s divorce bill from the EU. It takes Britain out of the EU single market and customs union, common fisheries and farm policies and the jurisdiction of the European Court of Justice. It also offers a status-quo transition period in which to negotiate trade arrangements.

Under a no-deal exit, there would be no transition period to soften the disruption to trade and regulations. Britain would quit the EU’s 500 million-strong single market and customs union and fall back on World Trade Organisation rules, which could mean tariffs on many imports and exports.